The month of February can best be summed up by the following word: snow. And furthermore, snow. This was a rather expensive month by Frugalwoods standards, which I’m not thrilled about. And, none of it was even for fun stuff like travel!
Uninterestingly, we simply had a slew of boring, semi-annual bills hit this month, including: car insurance (paid every 6 months), water bill (paid every 3 months), excise tax on our car (paid annually), tax prep software (paid annually), and thanks to the snow, a higher than normal gas bill. If that’s not some party-time spending, I don’t know what is!
For your amusement and possibly horror, in this post I’m presenting a low-tech time lapse of the ever-growing Snountain (snow mountain because I’m so clever like that) on our back patio.
Speaking of hits, someone hit the front bumper of poor ol’ Frugalwoods-mobile (while she was parked on our street) and dislodged it in a big way. Sad times for our 19-year-old beast of a vehicle. Our already narrow, one-way city street is now narrower than a greyhound’s tail thanks to–you guessed it–exorbitantly-sized piles of snow and ice.
So, I’ll admit that Frugalwoods-mobile was perhaps parked sticking farther out into the road than optimal, but someone clearly hit it and then gunned it. This was no light tap. Yet another joy of living in the middle of the city with no driveway or garage to our name.
My intrepid fix-it man Mr. Frugalwoods got out there with every frugal weirdo’s chief DIY materials: twine and screws. He worked valiantly for several hours endeavoring to fix the bumper himself, but alas, in the absence of owning a pop rivet gun (or pop rivets themselves), he wasn’t able to reattach it completely.
However, thanks to his bearded MacGyver skillz, he secured the bumper sufficiently to drive it the 3 blocks to our awesome mechanic. Were it not for his twine-related action, we would’ve been on the hook for a tow truck.
Since our mechanic is 1) awesome, 2) knows us on sight, and 3) appreciates that we still drive a car from 1996, Mr. FW was able to convince them to let him cut in line and help fix the bumper himself. He jumped in there with the mechanic and together they slapped that bumper back on in 10 minutes flat. $35 later, Frugalwoods-mobile is once again complete and we are yet again tremendously grateful that our mechanic is a mere three blocks away–this being the fourth time we’ve driven our car there on what could only be referred to as repair fumes…
Snow Does Not = Higher Spending
I’m pleased that we didn’t succumb to the common snow doldrums/cabin fever expenses of take-out, restaurants, movies, and the like. Other than our increased gas bill, our February expenses don’t belie the tremendous dumping of snow we’ve received. Part of this is luck–our roof hasn’t leaked for example–and part of this is our commitment to doing everything ourselves and not giving in to the temptations of paying for convenience foods or entertainment.
Despite our higher expenses this month (you know I’m happiest when our non-mortgage spending is below $1,000), we’re still on track to save upwards of 71% again this year. And it bears repeating that our high savings rate is absolutely a product of the incredible privileges Mr. Frugalwoods and I are blessed with.
Frugal Hound had a good February as she was featured on Cute Overload, to which she replied that she is a very fierce and serious greyhound and does not appreciate being called “cute.” Awwww, Frugal Hound!
Personal Capital: It’s How We Organize Our Expen$e$
We use Personal Capital to aggregate and consolidate our transactions from across all of our accounts. We then drop them into a spreadsheet to provide our below blog-ready analysis.
Tracking expenses is, in my opinion, the best way to get a handle on your finances. You absolutely, positively cannot make informed decisions about your money if you don’t know how you’re spending it. Sounds harsh, but without a holistic picture of how much you spend every month, there’s no way to set savings, debt repayment, or investment goals. It’s a frugal must, folks.
Personal Capital (which is free to use) is a great way for us to systematize our financial overviews since it links all of our accounts together and provides a comprehensive picture of our net worth. Always good to have everything in the same place! Here’s a more detailed explanation of how I use Personal Capital for my expense tracking.
Where’s Your Money?
One of the easiest ways to optimize your money is to use a high-interest savings account. A high-interest savings account gives you money for nothing. With these accounts, interest works in YOUR favor (as opposed to the interest rates on debt, which work against you). Having money in a no (or low) interest savings account is a waste of resources–your money is just sitting there doing nothing. Don’t let your money be lazy! Make it work for you! And now, enjoy some explanatory math:
Let’s say you have $5,000 in a savings account that earns 0% interest. In a year’s time, your $5,000 will still be… $5,000.
Let’s say you instead put that $5,000 into an American Express Personal Savings account that–as of this writing–earns 1.70% in interest. In one year, your $5,000 will have increased to $5,085.67. That means you earned $85.67 just by having your money in a high-interest account.
And you didn’t have to do anything! I’m a big fan of earning money while doing nothing. I mean, is anybody not a fan of that? Apparently so, because anyone who uses a low (or no) interest savings account is NOT making money while doing nothing. Don’t be that person. Be the person who earns money while you sleep. Rack up the interest and prosper. More about high-interest savings accounts, as well as the ones I recommend, is here: The Best High Interest Rate Online Savings Accounts.
How To Read A Frugalwoods Expense Report
From top to bottom. I jest, you could read it bottom to top if you so desire, I’m not going to stop you. As regular readers know, we itemize every single dollar we spend (which is why there’s a line item for $2 this month). I do this because it’s the most honest articulation of how we allocate our resources and managed to save 71% of our take-home pay in 2014 (after maxing out our 401Ks).
Interested in learning how we keep costs so low? Check out How We Save 65% Annually and, if you’re up for some hardcore frugal adventuring, take my Uber Frugal Month Challenge. If you’re curious about some of the common expenses missing from the below, our August 2014 Expense report has the answers (or feel free to ask in the comments below).
Why do we save so much and spend so little? It’s all in service of our goal to reach financial independence by age 33 and move to a homestead in the woods.
We don’t budget and instead live on frugal autopilot. This technique saves us the time and hassle of building a budget (we’re some lazy frugal weirdos). The caveat here is that many people find budgeting incredibly helpful and I in no way malign the budgeting process. If you operate more successfully with a budget, then budget away my friends.
And now, readers and greyhounds, I present you with every dollar that slipped past our paws in February 2015:
|Mortgage & Escrow for Taxes & Insurance||$2,741.01||Yep, it’s high. But, we live in a very high COL city (Cambridge, MA) and this house will be our cash-flowin’ rental after we decamp to our rural homestead.|
|Groceries||$305.38||This is consistent with our standard grocery purchases and represents all the food we eat for the month.|
|6 months of car insurance||$202.90||Our car insurance is levied every 6 months, so this represents one of two annual payments.|
|Utilities: Gas||$197.04||February was the second coldest month in Boston’s recorded history, and our gas bill reflects that. We’re just trying to keep ourselves and the pipes from freezing up in here!|
|Water bill (every 3 months)||$141.12||Our water bill arrives every three months, so this averages out to $47.04/month.|
|Household goods from Costco||$94.06||Household supplies (toilet paper, dog food, laundry detergent, vitamins, shampoo, etc). This total does not include any food.|
|Utilities: Electric||$89.15||It’s electric!|
|Internet||$66.95||Internet! Worth it! We use it all the time! Like right now!|
|Annual excise tax on Frugalwoods-mobile||$63.75||Annual tax paid to the city of Cambridge for our car.|
|Public transportation (subway passes)||$40.00||We both added money to our subway (T) passes this month.|
|Beer and wine||$36.73||Founder’s IPA from Costco for Mr. FW and Big House boxed cabernet sauvignon for moi.|
|Frugalwoods-mobile bumper situation||$35.00||As illustrated above, tragedy struck Frugalwoods-mobile’s bumper.|
|Gasoline for Frugalwoods-mobile||$25.61||Lower this month due to reduced travel due to extensive piles of snow!|
|Doctor’s appointment||$20.00||Co-pay for one medical appointment.|
|Tax prep services||$19.99||Mr. FW prepared our taxes himself–this was the cost of the prep software, TaxAct. He reports they did just as good a job as TurboTax but for a third of the price. Woot!|
|Blog back-up||$3.64||Gotta keep the ol’ Frugalwoods.com backed up! We’re lucky that Mr. FW is a software engineer and can manage our website himself, which keeps our blog-related expenses extremely low.|
|CVS Pharmacy||$2.00||I honestly have no idea what this is. Maybe Frugal Hound stole my credit card and bought some mascara…|